Global advertising market to grow by +5% this year

Monday, June 17th, 2019
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MAGNA advertising forecasts (Summer 2019 update)

Latest MAGNA report forecasts advertising revenues to grow for the tenth consecutive year in 2019 to reach $600BN – Linear (broadcast TV and radio, newspaper and magazine ad pages, out-of-home) advertising sales will shrink by -3% while digital ad sales will grow by +14% – In the US, digital growth has started to slow down in the first months of 2019, having reached a 52% market share at the end of last year.

Linear television ad revenues will decrease by -2% to $175 billion, due to the lack of major cyclical events (2018: Winter Olympics, FIFA World Cup and US mid-term elections). There will be some international sports events (Women’s World Cup in France, Rugby World Cup in Japan, Cricket World Cup in England and Wales, Copa America in Brazil) and large scale elections (India) in 2019 too but these events will barely move the needle in most markets (except Brazil and India) and not at all in the US.

Excluding the US, linear TV ad revenues will actually increase slightly in 2019 (+1%) as they did in 2018. Television continues to benefit from strong demand from traditional verticals sensitive to brand safety (CPG, pharma, automotive outside the US) and the technology sector ramping up its TV spend. Strong demand combined with shrinking supply (ratings decline pacing between -2% and -10% per year in most markets) triggers high CPM inflation that contributes to stabilizing TV revenues in many markets.

Television also benefits from an increasing volume of campaigns from “Direct-to-consumer” disruptor brands (Uber, AirBNB etc) that used to be digital-only in their marketing approach, but have started to campaign on editorial media too (mostly TV, OOH and podcasting). In some markets (incl. France and the US), non-traditional television advertising sales against TV programs (e.g. online or over-the-top ad-funded VOD) is helping television broadcasters to stabilize total advertising revenues. These are growing rapidly as consumption develops (+10% to +20%) but from a low base (no more than 5% of total television revenues today).